Shares in Finish Line Inc. surged late Thursday after the New York Post reported the Indianapolis-based retailer was nearing a deal to be acquired by United Kingdom-based Sports Direct International.
Citing a source close to the situation, the newspaper said “an acquisition could be announced in the coming weeks.”
“It’s all moving forward,” the source told the Post.
Finish Line shares sank slowly throughout the day but spiked more than 10 percent amid heavy volume in the final 15 minutes of the day after the Post story was published.
Shares closed at $11.66 each, their highest finish since Aug. 17.
Speculation about a takeover began growing in recent months after Sports Direct began aggressively accumulating stock in the locally-based athletic footwear retailer.
As of the end of August, the Sports Direct owned 7.9 percent of Finish Line outright. In addition, it holds a 21.7 percent stake through a form of derivative known as “contract for difference” that’s not available to U.S. investors.
In total, it holds a 29.6 percent interest in Finish Line, though it doesn’t have voting rights on the contract-for-difference shares.
Earlier this month, an analyst at Susquehanna Financial said he believes a buyout of the Finish Line is likely.
Sam Poser of Susquehanna said in a report that he believes there is a 75 percent probability that Sports Direct will buy Finish Line for about $13.30 per share.